India's economic growth likely hovered near a three-year low in the last quarter, underscoring the urgency of implementing politically difficult reforms to spur a revival in Asia's third largest economy. Finance Minister P. Chidambaram said last week that growth was about 5.5 percent in the three months to the end of September, warning that India faced a "a difficult situation" and needed innovation to boost output.

The government will release gross domestic product (GDP) data for the quarter at around 0530 GMT on Friday. "We believe that this will be the bottom of the growth cycle and going forward there would be a very, very small pace of recovery," said Rupa Rege Nitsure, chief economist at the Bank of Baroda. A growth rate below 6 percent for the third quarter in a row is damaging for a country that aspires to near double-digit expansion to provide jobs for its burgeoning population.

The slump makes it tougher for Prime Minister Manmohan Singh to fund flagship welfare programmes ahead of a national election due in mid-2014. Chidambaram told Reuters earlier this month that economic growth for the current financial year that ends in March could be as low as 5.5 percent, which would be the worst in a decade. A Reuters poll of 39 economists forecast that GDP rose 5.4 percent year-on-year in the July-September period, a whisker below the previous quarter's 5.5 percent and close to the three-year low of 5.3 percent growth in the January-March period.

Copyright Reuters, 2012